Pentagon extends tanker deadline

WASHINGTON -- The Pentagon will extend by 60 days its deadline for bids on a $35 billion contract for refueling jets so that the European maker of Airbus can compete.

Pentagon Press Secretary Geoff Morrell announced the decision today. Morrell said the military still plans to award the contract this fall.

The decision is aimed at encouraging competition in a program that critics say has been poorly managed and heavily favors Boeing.

U.S. Sen. Richard Shelby said the Defense Department made the right decision.

"The Department of Defense made the right decision today in extending the deadline for bids on a new aerial refueling tanker," Shelby, R-Tuscaloosa, said in a statement. "A sole-sourced contract would have served only Boeing's interests. The presence of a competitor better serves the interest of our warfighters and American taxpayers.

"It is my hope that EADS (European Aeronautic Defence and Space Co.) will be able to offer a competitive bid, despite the fact that the RFP (request for proposal) has been skewed toward Boeing from the beginning."

Northrop Grumman, which had been partnered with the EADS, announced in March that it would not bid because it didn't think it could win.

The companies planned to assemble the tanker in Mobile if they had won the contract.

EADS has said it may be interested in competing on its own but needs more time to prepare a proposal.

Morrell said that if EADS provides the Pentagon with official notification of its intent to compete, companies would be given until July 9 to submit their proposals.

"Nobody should confuse our willingness to change the bid deadline to willingness to change any of the plane's military requirements or the way bids will be evaluated," Morrell told reporters.

The program has been the subject of heated political debate among lawmakers, who want to see the contract produce jobs in their home states. European officials, meanwhile, say EADS has been unfairly shut out.

Following a White House visit this week, French President Nicolas Sarkozy said he trusts President Barack Obama's assurance that any new bidding would be "free, fair and transparent" and said that under those conditions, EADS would bid on the contract.

For his part, Obama reiterated that while "the process will be free and fair," the final decision would be made by Defense Secretary Robert Gates.